Well call me paranoid but I'm putting things in place for a massive recession. If I was to go bankrupt, I want to minimise the impact and therefore I was wondering can I transfer a property into my father's name who doesn't have debt? I own one property outright, but the bank has the deeds still from when I did have it morgaged,.. what costs could I expect,.. is it legal?

Why has the bank got the deeds if it was discharged?

I am debt free and have money stashed in my king mattress, send you deeds my way and ill take good care of them

Money in your mattress you say?

It's just plastic....

There's a very good reason it's called "real" estate.

Also there's a good reason they say "worth it's weight in gold".

When I finished paying off my property the bank wanted to hang on to my deed. They made the excuse that it would make it easier if I want an to take out another loan. I tried going to services NSW to get my deed but couldn't because it was held by the bank even though I owned the property and had payed the loan in full. In the end I had to pay the bank about $ 150 to have the deed transferred into my name and get a certificate. I will not use that bank ever again.
So I would imagine it would be similar.

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saltiest1 said..
Why has the bank got the deeds if it was discharged?

BS fees, $400ish,.. plus the speel that they were safer there.

But now I think it's worth it,.. even if I do begrudge BS accounting fees.

Hences the original post,.. I know I am up for costs, just trying to work out how much.

P.S,. I hate ANZ bank ????

Why single out the ANZ. It is just not fair. I have dealt with most of the big banks over the decades....and they are all the same.

When I killed my mortgage, the bank tried the same spiel on me - "leave your title deed with us to look after, much safer for you",
Told them no thanks - she got rather pushy, with the line that their safe was better than a drawer at my home.
She gave up when I told her it wasn't getting stashed in a drawer, it was going in my ammo safe

[actually - it is in my properly awesome big safe, which is in the archives vault, in the tunnel at work]

Title "deeds" are a thing of the past in Queensland. Title "deeds" are now entries on the database of the Department of Natural Resources and Mines.

If the property is mortgaged, the entry will reflect the interst of the mortgagee. I think the lousy banks still charge a fee to deregister the mortgage.

As avacado says, there is a reason it is called "real" estate. It is because it is still ownwed by the "real" (royal).

Similarly there is a meaning to the word "mortgage" which is "engagement until death".

I'd be getting it off them and put in a safety deposit or something.
Last time Comm bank tried something like that I kicked up a stink about social media and 40 years with them and got it for zip as an apology along with a year of account fees paid back. It's worth making a fuss.

Broad rule of thumb is anything you dispose of within eg. 5 years of bankruptcy may be clawed back?? - check your local laws

Broad rule of thumb is anything you dispose of within eg. 5 years of bankruptcy may be clawed back?? - check your local laws

Your case isn't like Ian's. In his case the property was in his name, but the bank had a mortgage registered on the deed. The fee he paid was simply the mortgage discharge fee.

In NSW, to transfer your property to another name, stamp duty will need to be paid on the property just as if it had been sold. Pretty sure it will be the same deal in WA. You can't just transfer the property at some nominal $1 value, you'll need to get a proper valuation certificate, although you can get the valuer to nudge the value down a little, but it will still need to be a realistic value.

In WA. the stamp duty is 1.9% of the first $80K, then 2.95% of the next 20K, 3.8% of the next $150K, 4.75% of the next $250K, and 5.15% of the rest. You'll also have a land transfer fee of a couple of hundred on top of that.

In other words, if your property is worth around $500K, it will cost you around $20K.

One trick is to transfer a portion of the property into your father's name, so if you only transferred half ownership of the house too him, you only need to pay half the stamp duty. Then if someone tried to repossess the house, they need to get him to agree to the sale. They could probably force him through some legal process, but it's makes it harder for them. However, unless you have some other bona-fide reason for the transfer, within a reasonable period (a couple of years), the courts can simply see it as trying to hide assets, and will take the house anyway.

By the way, I'm not a lawyer, I have no idea what I am talking about, although I have self-conveyed two properties. Everything I've said above is for entertainment purposes only and should not be depended upon. Check with a lawyer or other accredited property professional.

Harrows spot on. You could transfer to a spouse and avoid stamp duty though.

The od man would also have to deal with an increase in assets affecting things like pensions healthcare cards etc.

I'm probably more bearish than most gazuki esp when it comes to the inevitable big Aussie property bust but I'm not that worried about this one. It will be short lived and we will, throw the financial kitchen sink at it setting us up for the big one next time.

If you do need a valuation there's a sly way to get one super cheap.
Comm Bank charge $50 for one if you do it for a home loan application. Usual price was $600 for mine in WA. Application was free.

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Bara said..
Harrows spot on. You could transfer to a spouse and avoid stamp duty though.

The od man would also have to deal with an increase in assets affecting things like pensions healthcare cards etc.

I'm probably more bearish than most gazuki esp when it comes to the inevitable big Aussie property bust but I'm not that worried about this one. It will be short lived and we will, throw the financial kitchen sink at it setting us up for the big one next time.

Nope, even transferring to a spouse needs stamp duty paid. At least that's the case in NSW, might be different in other states.

(Again, all advice for entertainment purposes only.)

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Harrow said..

Bara said..
Harrows spot on. You could transfer to a spouse and avoid stamp duty though.

The od man would also have to deal with an increase in assets affecting things like pensions healthcare cards etc.

I'm probably more bearish than most gazuki esp when it comes to the inevitable big Aussie property bust but I'm not that worried about this one. It will be short lived and we will, throw the financial kitchen sink at it setting us up for the big one next time.

Nope, even transferring to a spouse needs stamp duty paid. At least that's the case in NSW, might be different in other states.

(Again, all advice for entertainment purposes only.)

NSW is way greedy then - you can transfer to your spouse stamp duty free in WA. Seriously where do the NSW govt get off taking a clip from a husband to wife change? You guys should have a revolution

Awesome info guys, thank you.

if you're declared bankrupt it means you can't pay your debts - ie you owe money to someone and can't honour the repayment.

there are strict laws to protect creditors from non-genuine bankrupts. if the trustee in bankruptcy believes you have transferred assets for the purposes of avoiding creditors then it doesn't matter what the timeframe is - that transfer can be undone or set aside.

footnote; i practise in qld but i understand a spousal transfer (including between defactos) is exempt from duty in all australian states, nsw included.

So if I dont have to pay stamp duty, how mush am I looking at?

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Gazuki said..
So if I dont have to pay stamp duty, how mush am I looking at?

3 - 5 years, first offence....

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Gazuki said..
So if I dont have to pay stamp duty, how mush am I looking at?

seriously, not sure in wa but in qld it'd be the $192 titles office lodgement fee plus any legals ($500-ish)...

I'd be looking up the term "phoenixing" ...................

And now that you're silly enough to have revealed your plan; and the reasons for it; on a public watersports gossip page, I'd reckon your creditors legal teams may have a field day in court with both yourself and your old man if things go pear shaped ............

www.ato.gov.au/General/Capital-gains-tax/Your-home-and-other-real-estate/Sale-of-property-and-other-CGT-events/Transferring-real-estate-to-family-or-friends/

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stamp said..footnote; i practise in qld but i understand a spousal transfer (including between defactos) is exempt from duty in all australian states, nsw included.

Interesting. I've had both a lawyer and accountant, (both of which I was paying), tell me otherwise. I'll have to call the NSW OSR directly and check.

Unless your old man lives with you, there'd be all sorts of CGT implications. Do your sums!

harrow, at least in qld the exemption only applies where the property transferred will be/is the couple's home (not for investment properties) and where the spouses will ultimately own as joint tenants or 50/50 tenants in common

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stamp said..
harrow, at least in qld the exemption only applies where the property transferred will be/is the couple's home (not for investment properties) and where the spouses will ultimately own as joint tenants or 50/50 tenants in common.

Okay, makes sense, for example if someone just got married and wanted to set up a 50/50 split. I wanted to go the other way around, going from 50/50 to 100/0, with my wife having full ownership. That is what I was told I would need to pay stamp duty on, and seems it could be right then.

Just the mid cycle correction. Don't panic. The big one is in 6 - 7 years or so. Markets will bottom in 2021 then its game on again.

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stamp said..
3 - 5 years, first offence....

You have got that right. Office Of State Revenue have no sense of humour at all.

Who would the money be hidden from? Some poor small business owners or home owners who may be left out of pocket because of this possible bankruptcy? Is that morally a good thing?